New York court upholds MTA payroll tax

The New York State Court of Appeals turned down an appeal Thursday, Oct. 10, 2013 to overturn a payroll tax that helps fund the Metropolitan Transportation Authority.

Nassau County, on Long Island, filed the lawsuit in 2010, joined by other counties including its neighbor Suffolk County. Nassau County has 30 days to appeal the decision, and likely will do so.

The court dismissed Nassau County Executive Edward Mangano's claim that a "substantial constitutional" issue is involved in his attempt to overturn the unpopular tax. The court upheld a mid-level court ruling that the tax, paid by employers in the 12-county region served by the Metropolitan Transportation Authority, is constitutional.

Nassau County is served by the Long Island Rail Road, and once also was served by MTA bus service until it decided to operate its own bus system. In part due to its dispute with MTA, the county in 2011 moved to establish Nassau Inter-County Express (NICE) Bus, operated by Veolia Transportation. The county's system has struggled with ridership and revenue issues in the past year.

"Rejecting the county's appeal summarily, the state's highest court found the appeal raised no substantial constitutional question. We are pleased by the decision," MTA spokesman Adam Lisberg said in response to the ruling.

The MTA says the payroll tax provides more than $1.2 billion per year to fund the region's railroads, subways and buses, and that loss of the tax revenue would have a "catastrophic impact on the region's 8.5 million daily transit riders."